The Hindu Business Line : GAIL declines REL's request for more gas from KG Basin

GAIL (India) Ltd has declined the request made by Anil Ambani Group company Reliance Energy Ltd (REL), to treat the company's `fall-back' allocation of gas from KG Basin as `firm' allocation. REL had approached GAIL to consider this treatment to ensure availability of gas from the region for its power station.

Sources told Business Line, "GAIL has not considered the request till now." REL had approached the Petroleum Ministry to ask GAIL for treating its `fall-back' allocation of gas as `firm' allocation in order to avert any adverse impact on its power plant in the region. Under the fall-back allocation, the gas marketing company shares the spare production available after meeting the firm allocations requirements of the consumers.

"It is not only REL but others also have been making similar requests. However, it is difficult to entertain such requests as there is a shortage of supply in that area," sources explained.

Due to gas shortage in that region, supplies to power plants were being made on pro-rata basis to their firm allocation. Since REL's firm allocation by itself is low, the company's Samalkot combine cycle power plant in Andhra Pradesh was being adversely affected compared to other plants in the region, REL had said in a letter to the Ministry. The other power plants' firm allocation is more than their minimum requirement.

REL had requested that GAIL could be advised to treat its 0.36 million standard cubic metre per day (MMSCMD) fall-back allocation as firm allocation and ensure that the gas supply to the company's plant is maintained at about 0.55 MMSCMD to avoid shutdown of the 220-MW power plant.

The conversion of fall-back allocation of Samalkot plant into firm allocation would improve the pro rata gas supply to the station and enable it to continue to operate in the combined cycle model.